Nordstrom loses tax appeal in Md. court

ANNAPOLIS, Md. (AP) — Maryland’s highest court has ruled that a subsidiary of Nordstrom Inc. can’t use its own error to avoid more than $2 million in state taxes.

The Daily Record of Baltimore (http://tinyurl.com/qzdot5n) reports that the subsidiary argued that it was wrong when it declared deferred income for 2002 and 2003. It argued that it should have filed a separate Maryland tax return in 1999, when a court decision that dealt with income-sheltering subsidiaries would not have applied.

Judge Robert McDonald wrote Monday that the company made mistakes “as a result of transactions apparently devised to avoid state taxation.” McDonald wrote that such errors don’t mean the company doesn’t have to pay taxes.

A landmark 2003 ruling by the court has curbed the practice of companies creating tax-sheltering subsidiaries in Maryland.

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Information from: The Daily Record of Baltimore, http://www.mddailyrecord.com

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